How are you doing compared to other SaaS companies? Are your metrics where they should be? Are you on the right track?
We built the Baremetrics Benchmarks feature to answer these questions.
We collected data from 800+ small and medium sized subscription companies using Baremetrics, anonymized it, and aggregated it to provide benchmark data for key metrics and subscription pricing.
This article will explain how to use Benchmarks to understand how your startup stacks up to similar companies, and where you can improve.
Growing SaaS and subscription businesses rely on Baremetrics for better benchmarking and subscription analytics. Start your free trial today.
Table of contents:
Where does the benchmark data come from?
All of our benchmark data comes from Baremetrics, of course! Baremetrics is used by hundreds of subscription companies to monitor the health of their business and improve key metrics.
To create our Benchmarks, we completely anonymize and aggregate all our customer data into one large data set. This allows you to see how your company stacks up against other companies with similar Average Revenue Per User (ARPU) values.
We segment based on ARPU because it indicates how much a business charges per customer.
What metrics can you compare in Benchmarks?
Benchmarks includes benchmark data for:
It also includes a separate section dedicated to Pricing Insights, which analyzes your customer base and different subscription plans in order to give you insights on your pricing.
How to interpret benchmark information
Like the entire Baremetrics toolkit, Benchmarks was designed to make understanding your data information as simple and intuitive as possible. Let’s quickly walk through what you need to know.
To start, let’s look at the Monthly Recurring Revenue (MRR) benchmark. You’ll see MRR values for the lower, median, and upper quartiles, as well as how your company stacks up.
The value of Benchmarks is to not only compare your company’s metrics with others, but how you can improve, as well. To help you get started, each benchmark will provide tips for improvement.
For example, if you can see that your churn is high compared to others, start with reducing churn. Growing MRR is near impossible if any new revenue you add is lost to churn.
All the data your startup needs
Get deep insights into your company’s MRR, churn and other vital metrics for your SaaS business.
Understanding Pricing Insights
There are two main components of Pricing Insights: Statistics and Breakdown. If you’re wondering if your subscription pricing is right, or thinking about changing your pricing, this is a great place to start.
Under Statistics, you’ll see four figures. These figures pertain to the Baremetrics data set, as in, 30% of Baremetrics customers with $100 ARPU offer a free plan.
The Breakdown section shows the volume of different subscription plans within the Baremetrics customers with $100 ARPU. You can view both monthly and annual plans.
From a quick glance, we can see a few things:
- Free and very cheap plans have the highest number of monthly customers
- $99 plans are significantly more popular than $100 plans or other nearby values such as $90 or even $80.
- Baremetrics customers are selling plans at all different prices, and for different reasons. What works for the majority might not work for you!
Conclusion
Knowing how you stack up to other companies helps you set goals and know where you need to improve in order to reach them. When you use Baremetrics, the Benchmarks features makes it easy to track business metrics and analyze benchmark data.
Frequently Asked Questions
What is benchmarking in business?
Benchmarking in business is the practice of comparing your company's key performance metrics against an industry standard or peer group to understand where you stand and where you need to improve. For subscription businesses, this means measuring metrics like MRR growth, churn rate, LTV, and failed charge percentage against companies operating at a similar scale. Without an external reference point, it is easy to misread whether a 5% monthly churn rate is a crisis or par for the course. SaaS benchmarks give founders and finance teams the context to set realistic goals, prioritise the right improvements, and make the case for investment decisions with data rather than instinct.
What are SaaS benchmarks and what metrics do they typically cover?
SaaS benchmarks are aggregated, anonymised performance data points drawn from a large pool of subscription companies, used to compare your own metrics against industry norms for businesses of a similar size or pricing tier. The most useful SaaS benchmark data covers MRR, revenue churn, user churn, LTV, active customers, quick ratio, and failed charge rates. Baremetrics Benchmarks pulls this data from 800-plus subscription companies and segments it by Average Revenue Per User, so you are comparing yourself against companies that charge similar amounts per customer rather than against businesses at a completely different scale or market position.
How can I benchmark my churn rate against similar SaaS companies?
The most accurate way to benchmark your churn rate against similar SaaS companies is to compare your numbers against peers with a similar ARPU, since churn dynamics vary significantly depending on how much your customers pay. Baremetrics Benchmarks segments companies by ARPU and surfaces lower quartile, median, and upper quartile values for both user churn and revenue churn, so you can immediately see whether your retention is above or below the norm for businesses at your pricing level. Once you can see where your churn sits relative to that distribution, you can use the improvement tips built into each benchmark to start closing the gap, whether that means tightening your onboarding, improving billing recovery, or rethinking a pricing tier that is attracting the wrong customers.
How do I use SaaS benchmarks to identify where to improve my subscription business?
Start by connecting your billing data to a benchmarking tool that segments peers by a relevant variable like ARPU, then compare your metrics across MRR growth, churn rate, LTV, and failed charge percentage against the lower, median, and upper quartile values for your cohort. Once you can see which metrics fall below the median, those become your highest-priority improvement areas. If your revenue churn is in the bottom quartile, for example, reducing churn should take precedence over aggressive acquisition, since new MRR added to a leaky bucket will not compound. Baremetrics Benchmarks pairs each metric comparison with actionable improvement tips so you are not just seeing a gap but getting a starting point for closing it. From there, you can track whether your metrics move toward the upper quartile over time as a direct measure of progress.
What platforms offer automated failed payment recovery for subscription businesses?
Baremetrics Recover is a purpose-built automated failed payment recovery tool for subscription businesses running on Stripe, Braintree, or Recurly. It automatically retries failed charges on an intelligent schedule and sends customer-facing email recovery sequences to reduce involuntary churn before revenue is permanently lost. Failed payments are one of the most overlooked sources of churn for SaaS companies, and the failed charge rate is one of the benchmark metrics Baremetrics tracks directly, so you can see how your payment failure rate compares to similar companies and measure how much MRR you are recovering over time. For subscription businesses trying to protect net revenue retention, addressing failed payments is one of the highest-ROI levers available.
How do I interpret SaaS benchmark data to set realistic growth goals?
Interpreting SaaS benchmark data accurately requires understanding that the median value is your baseline, not your ceiling. If your MRR growth, churn rate, or LTV sits in the lower quartile for your ARPU segment, that is the gap you need to close before focusing on expansion. The upper quartile represents what well-performing comparable companies achieve, which makes it a practical target rather than an aspirational one. Baremetrics Benchmarks presents each metric as a distribution across lower, median, and upper quartile values, so you can see not just whether you are above or below average but how far the top performers are ahead of you. Using this distribution to set quarterly metric targets gives your growth team a grounded, data-backed definition of what good looks like for a business at your stage.
How can I use pricing benchmark data to decide whether my subscription plans are positioned correctly?
Pricing benchmark data lets you compare your plan structure and price points against what subscription companies with a similar ARPU are actually charging in the market. In Baremetrics Benchmarks, the Pricing Insights section shows the distribution of monthly and annual plan prices across comparable companies, including what percentage offer a free plan and where volume concentrates across price points. This kind of data surfaces patterns that are hard to see from inside your own business, for example, that $99 plans significantly outperform $100 plans in customer volume, or that free plans attract the highest number of customers at lower ARPU tiers. If you are considering a pricing change or building a new tier, starting with this data gives you a realistic picture of what the market supports before you run an experiment.
